tv Today in Washington CSPAN November 2, 2011 6:00am-6:59am EDT
get when one looks of the date of the record for implementation of the clean air act since 1970 and the amendment since 1990 the data suggests the opposite really wonder as an economist would you comment? >> i agree and i would urge people to look at it the brimley institute they looked exactly at that sort of forecast for what regulatory changes were going to do to jobs, price increases, things like that, and consistently in the and the cost of the regulation this almost always smaller than -- >> the price of electricity? >> i'm not sure if they look to the price of electricity. the best estimate for what's going to happen in the electricity is the epa and i see a lot of studies out there that look out of line. >> i repeat in my native state the commonwealth of virginia, since 1990 the aggregate -- the
net cost of electricity has gone down by 36.5%. with that, i yield back mr. chairman. >> if i can ask the gentleman a question about your state. in virginia for those to go down i'm presuming that sense it is a rate based on their cost that's a matter of efficiency to reduce costs over the same period of time they produce more electricity at lower cost, where they are getting a free turn on their capital, regulated return on their capital. so in this case, where the epa by its estimates has a cost of implementation, those costs would be passed on so it would be temporary spike in what otherwise is a cost benefit reduction that they've been achieving that period of time. >> the chair takes an important role that could happen. i would only point out that contrary to the first witness testimony of the reason for this
week's especially in the rural parts of virginia have to do with every regulation of the industry the was written by the industry and the general assembly of virginia and had nothing to do with federal regulation. >> i appreciate the explanation and i will tell you that as somebody that has seen our state go through deregulation, a dramatic reduction in cost we have partial reregulation although not completed as one of the challenges to we give the regulated utilities when they are given the cost plus situation the often do not complain about the cost drivers because the can pass it on in the cost of benefits to their stockholders. the same time they will say they want a free market system but maldon can't they give greater profit margin. he has a good point in your
state as i do in line. at this point i should adjourn. dr. bivens you were very helpful. you're entire statement will be there. additionally because you had not as many witnesses that you have questions related to some economic hypothetical set me be beyond what is in your comments you provided to read any additional for the next cuts say seven days and if you need along derleth us know. we will keep the record so anything you believe are missing and also see if there on the upside or downside we would appreciate having -- additionally, if you could do me a personal favor of the committee a personal favor. to the extent to could issue us the cost of a delay was they just had 30 years in the implementation and the benefit that is potentially there from slight adjustments in the final
standard how you think of best pal letters of a slight change in the worst case because he has a cost to clean air. benefit may lower the cost of ultimately greater affordability. i didn't see that in your earlier stuff. it's kind of esoteric debt for all of us who want to weigh dewey deily to get the right to this the cost of the delay something since we are talking about the 90's until today i feel we have to run that perspective and a yield to the ranking member. >> i support your question because i think that to try to understand the economic success this i wonder of the tram would also ask him to provide a little more knowledge to his questions about the job number the creation.
pretend like you're in to help us understand the different methodologies -- >> to the extent that is the ranking member said it might be more artfully than i did because we do see where one side is looking at the cost of jobs, higher utility costs and so on, and the other side self-serving lee and rightfully so is looking at the jobs created and obviously we want to look at the balance particularly in the relative states to think the doctor's comments were right on in the free-market regulatory state much of this could be a compression of province of the utilities. in those states that our cost plus or regulated it's going to be passed on the and i think that's one of the things the ranking member made a good point that to read and with the affirmative yes, we stand adjourned.
event. >> after larry summers left. prior to that, he served as counselor to the secretary of the treasury in the first two years of the obama administration, and brings a wealth of experience that position. the director of the national economic council ordinates and helps develop economic policy for the administration and the president. the experience that he is brought as he had the same job in the clinton administration. at the beginning of that administration, he served as deputy head of the national economic council under bob rubin, and later he became the director of the national economic council. he has held this position before, and has not been involved in 11 straight years of democratic economic policy making, where more than any other one individual in terms of consistently working in the
democratic administrations and a key economic policies. he is from an arbor, michigan. he is a diehard wolverine fan. he went to the nervous the of minnesota where he was recruited as a tennis player, won a scholarship, and played as captain as the university of minnesota tennis team. he went to yale law school where he continued his great academic pursuits. at minnesota he had was a member of phi beta kappa. after all school he began to get involved in public policy matters, but also worked for mario cuomo in the early 1990's, and then was recruited in the new caucus campaign to work for bill clinton and he ran the economic policy unit of the clinton campaign in 1992.
when he left the clinton administration, he joined the workings as a scholar and the council on foreign relations and set up a center for universal education to help children around the world make sure they get education. he spent time as a consultant to the west -- to "the west wing." he was interviewed by a writer and the writer subsequently became his wife. gene is now married with two children. he resides in washington now and is well known, i think, for his enormous encyclopedic knowledge of economic policy. he spent 11 years working on economic policy matters, but also for his workaholic tendencies. for the last 11 years he probably per hour is the least well a person in washington, d.c. it is our great pleasure to have a gene make a presentation, and later we will have questions and
answers. gene? >> thank you, david. the last time i saw david rubinstein was at the kennedy center last sunday night. he was introducing jack black, ben stiller, and will ferrell. and today he introduced me. i have now arrived. that never happen my first time are riled. i am always happy when people mentioned that i was consultant for four years at part-time writer for "west wing" because in washington all of you think it is way cooler to have worked for the fate west wing instead of the real one. while the real west wing has been the highlight of my professional life, the fate west
wing has been a highlight of my personal life. it is where i met my wife, who many of you have got the deten to know. a very happy to be here. there are so many friends out here. i'm so happy to be here with david rubenstein and has given me advice and counsel since my first days when people said since i stayed up very late at night i reminded them of another crazy man who worked in the white house in the carter administration, and i later learned that that was david. anyway, thank you all for having me. mike tock today is simple and direct. -- my talk today is simple and direct. to sustain economic growth now we need a bold, and the jobs
plan to inject a man, help as recovery takes hold, and have a meaningful impact on jobs over these next 12 to 18 months, and, two, a balanced plan for long- term physical discipline that includes saving entitlement and revenue from the less fortunate while continuing to make sure we invest in the young people and the economic dignity of our working families. i will start with the imperative for all action to start jobs. there are those of you who will recognize the need for a jobs plan. those who make the case for inaction at this moment usually do so, usually state as the reasons that we already tried the recovery act and they claim it cannot have an impact. that we cannot afford a new jobs coming backe we're from a financial crisis we have
to be passive and patient and that a bold, immediate effort is inconsistent with focusing on longer-termed structural issues in our economy. i will address each of these arguments, but even combined, they fail, because in the current economic context, unemployment is simply too high. the projections for near-term growth are too weak. the risks to the economy, to elevated, and the national price of long-term unemployment to profound to sit on our hands and do nothing. to those who say as an argument for inaction that the recovery has failed, i will highlight two basic facts. in november when obama was taking over an economic policy, the blue chip forecast projected the economy will contract in the
fourth quarter of 2008 and in the first quarter of 2009 at an annualized rate of 1.65%. in other words, they were projecting the economy would be near 2%.t pace in december, that projection had gone to 3.25%. what do we know now? what we know now that we have better information. during that time, the economy contracted at an annualized rate of 7.8%, nearly 8%. actually, in the fourth quarter of 2008, our economy was contracting, losing growth, at a rate of 8.9% a year. it was the worst six-month period since records of quarterly growth work at first in 1947, other than that. of demobilization in 1946 after
war ii. it was the worst six months on record since the heart of the great depression. the worst record since the heart of the great depression. with the passage of the recovery act and the financial rescue package, growth actually returned to our economy by the third quarter of 2009. one half year later and private sector job growth returned in march, 2010, a year after we had lost 800,000 jobs in a single month and a year earlier and recovery from the previous recession in 2001. we are big boys and girls.
we understand the president's opponents will continue to make the next the arguments -- to make the speedy argument that since we have much further to go in thinking ourselves out of the whole the president inherited that therefore that is evidence that the recovery act did not work. but let us be serious in one crucial regard. using the experience of the recovery act, which is critical to bringing our economy back from a contraction of nearly 8% a year and a loss of eight and a thousand private-sector jobs a month as an argument that any future effort to inject a man to create jobs is futile is but a cynical argument and one without merit. it may be that it prevented the second great depression does not read well on a bumper sticker, but is peppery description of
policy decisions that help and improve the lives of tens of millions of our fellow working families. some have suggested to me that even if the recovery act was the right medicine for the economy in 2009, that today we should just sit tight. they will argue, often citing the work people, that as recoveries following recession- induced by terrible financial crises are inevitably going to be long, slow, and painful, we simply should just wait and be passive as the slow process of healing unfolds. i am not sure i would ever agree with this interpretation, but if we were projecting 3.75% growth next year and a conversation was simply about the pace at which unemployment was headed down, we could at least have a conversation about how quickly
one could expect action to further accelerate growth and lower unemployment. but that is not economic moment we face today. it is not the economic outlook we foresee over the coming year. we have an obligation to take a sober, non-political look at the state of growth and employment in our country today, the risk that it could get worse, and what it would mean for our country if we did nothing and simply allow the consensus economic forecast to come to pass. with regard to the risks, everyone understands the value of taking out insurance against ive events in our personal lives. the administration projects the economy is still to add to the private sector jobs the been created this year.
most forecasters agree with this assessment. even though the blue chip financial forecasts found a 35% chance of a double-dipped recession among their nearly 50 forecasters, it is our hope that with the uptick in some recent numbers those odds might go down. nonetheless, it is still fair for all of us in policy positions to ask, when you already have 9% unemployment and 14 million people out of work, is it worth taking out some insurance against even the prospect, even the relatively less than 50% chance that things could get worse? if you thought there was a one in three chance that your house was going to burn down, you would find home interest of the bible. likewise, the value of taking insurance out for our economy today is alone strong basis for
taking bold action in the immediate future. remember in 2010 when we have passed separate payroll relief, the price of gasoline was $3 per gallon. we did not know that the error spring and defense outside our control was " pushed prices over $4 a gallon in some parts of the country, but there's little doubt that the insurance we took out in the form of the payroll tax relief has provided a crucial question to prevent consumer spending from falling and putting us in a stronger position than we would be otherwise. but even if one decides that the need to take interest out against unexpected events at this time of high unemployment is not persuasive. the case for action, if standard projections bear out, is overwhelming. right now, the blue chip
projecting 2% growth in 2012. the conference board is projecting 1.1%. jpmorgan, 1.7%. imf world economic outlook finds 1.8% growth for 2012. as such growth would be the load the trend growth, it would hardly be projected to even bring unemployment down below 9%. this type of growth should be unacceptable and unsatisfactory at any point in any recovery. in any context, it constitutes less than turning a blind eye to our national crisis of long-term unemployment. while washington today is focused on the political punditry over the ups and downs of the american jobs act, it is long past time for all of us to realize that long-term unemployment is our true
national economic crisis. and that choosing to play politics as usual or sit on our hands in the face of this crisis is both irresponsible and inexcusable. that death of a recession this president inherited and the difficulty of recovery from a -induced ly r recession has forced us to consider it a lot worse and a climate in our lifetimes. 44.6% of the unemployed is now -- has now unemployed for more than six months. 75% of them have been unemployed for a year or longer. consider this -- the average length for the unemployed right now is 40.5 weeks. that is the worst on record.
it is almost twice the length of the highest prior record, which was 21 weeks during what was a very painful recession in the 1980's. this is a matter of the highest economic importance. we know that very long spells of a plum and cause harm to workers, to families, and to our long-term economy, that shorter terms and more typical out of unemployment do not. we know when you lose a job it is always painful, but when you are in voluntarily out of work for a year or two years or more, you lose your home, you health, the family. economists have used the term to describe where and a lot -- where elevated and employment can reduce our productive
potential. being out of work makes it harder to re-enter the work force. if you lose your job today, your chances of being employed in the next three months are box one in two. but if you lost your job for six months, the chances of the next three months is about one in four, gets worse and worse the longer you are unemployed. and an economist at university of warwick sound there's no circumstance that has a greater negative impact on mental health than being unemployed for six months or longer. and economists found a permanent job loss results in up to a 100% increase in mortality rates for the next 20 years. on top that, the national employment law project found that a four-week survey of
online job advertisements, over 150 examples of companies explicitly saying if you're unemployed, do not apply. do not apply signs that were -- now being put up for those who had the misfortune, usually at no fault of their own, of finding themselves in the dire straits of long-term unemployment. of course, concerns about the cost of long-term unemployment lead to one of the other rebels in the case for inaction, which is that a diploma is purely a structural problem. some argued there are more than three made jobs openings and this shows that all our problems are simply due to a mismatch between skills needed to fill current spots and the skills possessed by an unemployed workers. as recently described by those,
there's little evidence for this case. here is the simple math. there are over 14 million people looking for work, full-time work, not even counting the people who are halftime looking for full-time work and 3 million job openings. that means there is newly -- there is nearly five people looking for every job that is open, far higher than any people looking for jobs before the recession. no questions that skills mismatch issue is a and a poor long-term issue that we should be committed through education and innovation to fixing. recent research by the new york fed makes it clear that explains only about 1/5 of the rise in employment in the recent recession. with this and other evidence, it suggests the overwhelming cause of the ottoman crisis we face is a lack of economic demand, and
the real irony we face here is not so much that structural unemployment is driving high employment right now, but instead that if we fail to act, we will create a new and deeper structural unemployment in our economy. we will by sitting on our hands allow legions of our colleagues, our neighbors, to be disconnected from the work force for unforeseen periods of time. this takes me to a final point on the subject, which is that a lot of what we do in economic policy is try out policies that prevent this cycles that i necessarily take away the value in our economy. we have bankruptcy laws that prevent credit rushes that would unnecessarily destroyed the value of company or the future of someone who has failed once.
steve case will tell you what a difference it would be if a debtor prisoner inside of a second or third chance was what happened to len gonchar nor who failed their first time. we do not allow bankruptcy, a rush of creditors again because it unnecessarily leads to a downward cycle that hurts our economy. we have deposit insurance to prevent the vicious cycle of- runs on banks, and we try to promote policies like our neighborhood stabilization plan and the american jobs back to prevent a downward cycles in neighborhoods. if we see sections of up to 2% growth right now that inevitably mean that the prices of long- term unemployment will get even worse, we are in essence saying that we know millions of our friends, our neighbors, fellow
citizens are destined to a downward cycle of economic opportunity that will cause long-term damage to them and our economy and that we are choosing to simply sit back and watch. a great nation, facing the worst crisis of long-term and apply it in our lifetime, can certainly do better. at president's american jobs tries to deal with this challenge in two and a waste. it has the smarts demand plan for next year that independent economists have projected result in up to 1.9 million more jobs next year, that is 150,000 more jobs per month than is currently expected and up to 2% higher economic growth, the difference between 1.5% and 3.5% growth it was planned to its completion. it includes elements like the payroll tax cut which uses an existing structure to get a significant amount of money in
the pockets of every worker every two weeks into doesn't call will provide work customers and more cash for the small businesses who have been hit hardest by the financial crisis. further at this moment, there is -- the american jobs also is a major investment in creating jobs by the rebuilding our infrastructure. there is just no sound reason not to make a major investment in our infrastructure right now. let me be clear about one thing -- there is nothing fiscally irresponsible about deferred maintenance. if i choose to cancel my direct tv, nfl subscription, with, which the lines at 6-2 i am not going to do, i would say $230 in consumption. if i decide not to fix that i did my basement, i would just pay more later. at this moment, with interest rates at historic lows, with an overflow of the unemployed construction workers anxious to
get back to work, when the macro economic impact would be the best and manageable, how can we passed by this moment to address the deferred maintenance in our schools, roads, railways, and airports? how can we let this moment pass? what is the rationale for not acting? the second thing the president did when he announced his act on september 8, to dow's 11, is but a national focus on this challenge of long-term unemployment by making it explicitly one of the four major planks of his plan. that meant, including every responsible idea we can identify, from outlawing hiring, discrimination based on being unemployed, to tax credits for people who but a ploy for six months or longer, extra incentives for veterans. we proposed the misleading reform out of plumb it interest in the last 40 years.
every aspect of the reform is designed to make and implement insurance more of a bridge to work. and hiring people to use their u.i. to connect for short-term jobs or to start their business or as wage interest out older workers get back to work or for companies to include work sharing over layoffs. we are no doubt disappointed that the republicans in congress have blocked the american jobs act. but that should not be our major disappointment. our most profound disappointment should be that they have not even come forward with an alternative plan that in the top independent forecaster could possibly estimate as spurring growth up to 2% next year or adding up to 2 million new jobs. at this moment the republicans' main alternative is the best to get a host of long-term measure
, some good, like trade agreements and then reform, some not so good, like repealing the affordable care act, but all having one thing in common -- they have nothing, absolutely nothing to do with sparking demand or job growth in the next 12 or 18 months so that we can get this recovery better chance of taking hold or give hope to the long term on a point of getting back to work. these plants are therefore not really jobs plans. they are plans to sit by while our national crisis gets worse. franklin roosevelt argued during the depression of when facing great national challenges our obligation was to try and try, expert and experiment until we get it right. yet the republicans in congress so far cannot live up to teddy
roosevelt's admonition to get in the rain and get a shot. there is no question that the right physical package for policy at this moment is to combine this strong demand in the short term with a balance, long term plan for fiscal discipline. the two are not contradictory. they are as complementary as good hitting and pitching. and together they are exactly what we need to maintain confidence that the economy is going to pick up, america remains a place for companies to make a long-term investment, and we will not face a debt crisis in our country in the near term for a share. those who suggest we cannot afford the act are being penny wise and pound foolish. nothing will hurt our current efforts to get our path is a steadily more that if our economy stays weak or if we allow long-term and implement the weak economic projections and potential. furthermore, when you pay for the jobs planned as the
president has proposed, the long-term cost is just the lingering interest from the jobs planned, while the ongoing offsets lead to net deficit reduction each and every year for the foreseeable future. there is a reason that even their rivlin-does she plan, when of the most efficient plants the together by bipartisan outside group, including the most robust injection of temporary demand come complete payroll tax holiday to ensure our recovery takes hold. if we are to succeed in achieving strong that is a reduction, let's be honest -- the single most critical ingredient will be the washington reaching a consensus that we must have a balance in our deficit reduction strategies. there is no single barrier that stands and away more of same fiscal policy and the fact that the sizable proportion of the republicans in congress have
taken a pledge that there cannot be a single penny of revenues in any significant deficit- reduction act. is notbsolute pledge a historically republican position. in 1982, president reagan raised revenues. in 1983, he and ted o'neal include the revenues in fixing a social security. in 1990, the elder president bush were to get a bipartisan agreement that included revenue and the visits. in 1997, we had a balanced budget agreement where republicans agreed to continue all the revenue increases from the 1990's and the 1993 budget agreement. every independent bipartisan plan has called for a mix of revenues and entitlement reforms. a letter calling for reductions from republicans and democrats include an endorsement of a mix
of revenues and entitlement cuts. prime minister cameron has as much as 1/3 revenue in his budget. the spots us from making progress for a few critical reasons tricks everyone knows the way you achieve bipartisan deficit reduction is through people holding hands and jumping together. to conclude, it is with this that we can best move our nation toward the shared prosperity that should always be the aspiration of this country. thank you very much.
>> so you are not point person in negotiating with republicans? >> i often have ben part of the team. we stand ready to. david, you cannot do this thing we make no differentiation. the president very clearly has continually reached out. he over the summer, we all know, was willing to go further on entitlement savings, take on more sacred cows, risk taking opposition from his base of supporters in the interests of getting an agreement. it is the president who has put out to the supercommittee
proposals in detail that would cut agriculture subsidies, affect federal retiree benefits, that talked about adjusting beneficiary changes for medicare. so when you have this of the inability to come together, you cannot just decide that your analysis is that it is a pox everybody's house, that everybody bears the same responsibility for the failure to come together. you have to look. and others part of the 19797 balanced budget agreement. i was one of the people who encouraged and supported us calling to the extra mile at every point to try to get a major budget deal with the speaker. so i am very much for
bipartisan negotiations, and i want to make clear, i believe there are many republicans on the hill who want to be part of the balanced agreement. you have seen the gang of six, a few republican senators in the bowles-simpson who are willing to raise revenues. this is not a democrat- republican issue as much as a portion of republicans who are blocking from coming to a compromise of a budget agreement that includes revenue savings together with entitlement savings, including medicare as part of a bipartisan -- >> you do not have a majority of democrats, cannot get 51 democrats in the senate, to vote for it. i thought the democrats did not support the president's jobs
bill. >> that is not the case. we have sometimes 53 out of 53, 51 out of 53, 50 out of 53. one of the people -- have been here a while, as he said, you have been here a while. getting 96% of your own party is pretty good. you cannot look at -- the reason we're having trouble is that there is a complete inability for any one to come over. i understand what i did in my talks today. i did not say, here is the american jobs at come our way or the highway. i presented the case for action. i presented why we as a country cannot sit on our hands and do nothing.
>> why did the president not meet with bowles-simpson -- why did he not meet with them at that time? >> he chose those two men. he chose representatives that were very much about reaching a bipartisan agreement, moving toward the center. he was very supportive of their actions. we do not or did not agree with everything in the bowles-sim pson plan, we understand the way you make progress in deficit reduction measures is to create
the mechanisms where you bring both houses and both parties together. every successful effort we have ever had as that characteristic. that does not mean it always works. it was very close to working over the summer, but just failed. none of us know for sure how the supercommittee will turn out, but that notion where you bring democratic and republican leaders together from both the house and senate to hold hands and jump together is the only hope you have. nobody wants to put their political life on the line for a plan that they find out is going nowhere or is going to pass the senate, but not pass the house. if you are interested in actually getting things done as opposed to getting a good op-ed at on the back, what you want to
do is exactly what this president did, which as soon as we got down with the yearly c.r ., agreement that took record, within five days of that, the president put out a $4 trillion framework over 12 years and called for both houses and both parties to come together. add the biden group and that was the first effort. bulls simpson bipartisan commission was called together by this president. biden negotiating process was pulled together by this president. the president and speaker boehner -- and i give him credit for being willing personally to reach out and put revenues on the table as part of the deal, even though he could not ultimately deliver that deal -- i give him credit for trying. in each of these cases, it was the president was trying to create a mechanism that is the best hope for bipartisan deficit
reduction, and i promise you, whenever it comes, it will come in this form. it will come in this type of -- it will not be because the president of the united states goes out with an independent group's plan. it will be because he brings both leaderships of the house together. that is what happened in 1993 and in 1990, hot hot for, and hopefully that is what will happen this year with the supercommittee, and if not, there will be a process like that in the future. the president was focused what the process and the mechanisms to word that had the best potential to get the job done. >> the stimulus bill that not have republican support, so the president did not the republicans there. do you support the fact that he was republicans to support it and it was not likely to succeed, and you said at the time there was a good economic
impact from that stimulus bill, which has not seem to have that impact. why do you think people should say this past -- why should people believe you now? >> people say to me it is hard argue that the eggs are better than they would have banned. what i just presented to you once they are way better than they were. you cannot make everything a political argument. yet to digest the following facts -- our economy was shrinking at the rate of 8% a year when the president took office. 8%. we have not seen that since the great depression. we were losing jobs at 800,000 and month. expect your economy to add 2 million a year? we lost 2.3 million in three months.
by the second half of 2009, just six months later, our economy was back to growth is not something you can take for granted. there was no guarantee that was going to happen. that happened because this president took a very bold politically different actions -- difficult actions, and the fact that we were creating jobs, albeit much too slowly a year later, in march of 2010, a year earlier than took place after the previous recession, again did not happen by accident. so i totally agree that the deep financial crisis that we inherited was a very deep hole and that it is discouraging how long and tough it is to climb the way out, but i wholly refuted and disagree and to speak anyone who suggests that the recovery act did not have a
major impact in helping ensure our country to not go into a great depression and instead went to growth. what was the stock market in march when we were doing the financial rescue plan 6400. one out of five people was betting it was going under 5000. you cannot take for granted what happened. the idea somebody would use the recovery act as an argument suggest he should not do this type of demand injection for jobs is totally misguided. 2009,remember january where was the demand in the global economy to eur? europe? what industries when people were seeing their house values going down? had united states not go in and inject the man into the economy, had we not taken the type of
action, the stress test, and the action on the automobile -- we could have faced an unforgettably painful economic. -- economic period. we understand our opponents are pretty is the fact that things are not as great as any of us would like to suggest. but nobody who is not political is serious, nobody should buy into that. >> the and implement rate today is 9.1% as we count it. no president since fdr has been reelected and the rate was above 7.2%. where the you think the unemployment rate will be at the time of the next election? >> i will not make projections. whether or not we do something about job growth right now is calling to determine in part that outcome.
i'm here making the case for a jobs act because i fear that if we just sit by and allow the standard economic forecast to take place that we're going to grow 1.5%, 2%, that we are going to be sitting by passively while we do serious harm to many of our workers and our economy. remember, you expect that you need growth to be about 2.5% just to stabilize employment, just to handle the new workers who come into the workforce, just to stabilize. when you have 9.1% unemployment, you need growth to be much stronger than that to bring unemployment down, and as i just described, you need unemployment growth to be stronger than that to encourage workers, companies to look beyond the best young
people coming out of college and the start giving those who have been unemployed a year or longer a second chance to get back in the workforce. rather than us handicapping or banking, the right thing we should be acting. we have a chance as a country to take action that would meaningfully affect -- moody's said with the jobs back in the project for put two% scion growth. -- 4.2% growth. so whether or not we'd do something bold and immediate like what if it has different elements or slightly different composition, is the single most crucial thing we can do to being ableo the cht
the unemployment rate coming down our but as opposed to bad. >> the president has said thecon he thought was going to be when he was a candidate. and it is a problem is bigger. why do you not support eliminating all the bush tax cuts? that would pick up $500 billion the year. why not get rid of all of them as opposed to people in the top 2%? >> because i think at this point that hit on working families struggling in this economy would just be too great. i am not convinced that we need to do that to achieve deficit sustainability. for example, we have already put $1 trillion into a deficit reduction agree to over july.
the president then put forth his job -- his plan to the supercommittee. that plan does have a seat of that revenue portion, but it only $250,000.'s that plan together risks that down as a percentage of our economy. i do not believe that if we were to let all of the tax cuts expire and have working families making $70,000, $80,000, suddenly facing a $3,000 higher tax increase that that would be good. and so i think we still believe that we can get our deficit under control, bring our debt down as a percentage of our economy, and do so by asking for sacrifice broadly, but by asking for revenues to come from those
two had income of $250,000 and over. >> where would the president like to see the capital gains rate? >> i do not have anything any different to say than what was in our budget. i do think there are areas that we think -- what the president has spoken of is the fact that we should be concerned when very, very well off people can take all their income under preferred rates so that somebody making $100 million, etc., is simply paying 13%, 14%, 15%, and you have a situation where the net or even the incremental
taxes of people who are teachers, fire chiefs, firemen, are higher than those who are the very, very most fortunate. the idea of the buffet rule would be if we with the tax reform and bring down everyone's rates, if we were to reduce tax expenditures, that it was important to be able to say to the public that this would not mean those who are the very most fortunate would be able to, in the fact, they effective rates that were dramatically lower than that. and that is what we put out. i think that is very reasonable. i think the public supports it largely, i just saw a poll saying those who make over a million dollars support that put the ball as well. >> under the buffet role
heavyset that rate? >> were setting up a double for tax reform. right now one of the openings you have seen from at least a few of the republicans in the senate has spent -- has been to raise revenues through tax reform. we wanted to put out what our principles work for tax reform, and one of the things we wanted to say was be supported the idea low ring expenditures, raising revenues, but luring everyone's rates. in doing that we wanted to have certain principles. when of the was we did not want the tax code to get less progressive than it would be today or in the absence of the sun setting of the bush high- income tax cuts, and the second one was going to be if you're
going to be taking down rates and taking alkylates for those in the highest income brackets, it was the essential to say there would be a floor under which the rate would not go, and that was obviously something warren buffett had spoken about quite a lot, and the point there is that that is not even the principal that will affect most people who are very well off. it will only affect those who are somehow able to organize their income so that all of their income or the overwhelming majority is at preferential rates. again that is a principle that has wide support, so because we do not know exactly the metrics of what tax reform will become we wanted to put that out and the progressivity principle out. you have worked for mio